Supply chain conditions for the nutrition industry are still a work in progress, but they are definitely showing encouraging signs of improvement. Warehouse inventory levels are increasing, lead times for ingredients, raw materials and packaging are decreasing, and prices are starting to come down.
Though we’re not quite at the 2019 pre-pandemic levels and lead times, the progress that we saw starting to enter the market in the summer of 2022, has continued to improve each month since. For nutrition industry companies managing their supply chain as we continue to work toward more normalized conditions, having the proper technology, systems and processes in place remains critical.
At Lief, for example, as a contract manufacturer supporting numerous brands with a vast range of ingredients and packaging needs, we’ve worked over the past few years to fine tune our Enterprise Resource Planning (ERP) systems and other key internal business intelligence resources and dashboards to not only better manage the day-to-day, but to also enhance our forecasting and capabilities to look ahead. Companies who have these kinds of vital systems in place will allow their supply chain and purchasing teams to see further ahead to identify and better plan for any potential issues, pain points and disruptions that may be coming.
Innovations in Nutrition Industry Supply Chain – Regenerative Agriculture
In addition to focusing on more traditional supply chain management systems and internal processes from a bottom-up perspective, it’s also important to consider key macro factors that impact the nutrition industry’s supply chain and how nutritional ingredients and raw materials are sourced. One particular innovative area gaining traction in the industry that can have a huge positive effect on the supply chain, as well as sustainability, food security and climate health, is regenerative agriculture.
Regenerative agriculture is a way of farming that focuses on soil health. When soil is healthy, it produces more food and nutrition, stores more carbon and increases biodiversity—the variety of species. Rotating crops to vary the types of crops planted improves biodiversity, while using animal manure and compost helps to return nutrients to the soil.
Healthy soil and soil preservation is vital. According to the Food and Agriculture Organization (FAO) of the United Nations, we rely on soils for 95 percent of the food we consume, and by 2050, 90 percent of all soils are set to be degraded. Without change, degrading soils will put our ecosystems, our climate and food security in jeopardy. Sustainable soil management practices such as regenerative farming can help with carbon sequestration and soil recarbonization to reduce these future risks and help preserve our supply chain for the long haul.
Regenerative farming on 40 percent of the world’s cropland would save around 600 million tons of emissions, according to data from the World Economic Forum. And, economically, regenerative agriculture improves long-term farmer livelihood through reduced costs, improved crop yield and crop quality, and greater resilience to market volatility and extreme climate events.
Although regenerative agriculture may be viewed as an innovative approach, it’s actually how many cultures farmed for centuries, prior to the 20th century when we started to change the way we farm to specialize in specific sectors and more mechanical soil tillage methods. Tilling and the constant turning over of soil exposes the microbes and releases the carbon and the nutrients out of the soil into the atmosphere causing soil degradation, as well as greenhouse gas emissions.
Alternatively, regenerative agriculture does not use tilling, but employs a natural process by using farm animals to generate soil agitation with the animal’s hooves. Naturally occurring examples of this are things like the wildebeest migrations in Africa. As wildebeests migrate across the African Savanna, they naturally agitate and fertilize the soil resulting in massive growths and blooms.
This natural method helps to maintain and keep the carbon and other nutrients inside of the soil so that when the plants grow, they are healthier. When we get healthier plants, we have healthier food and nutritional ingredients. So, regenerative agriculture can help bring healthier non-chemically enhanced food and products to our tables and creates a more balanced environment and supply chain that’s more sustainable for the whole industry.
Implementation of Regenerative Agriculture Practices
In terms of global adoption and implementation of regenerative agriculture processes, significant efforts are being made by organizations such as the World Economic Forum and the FAO of the United Nations who are working to educate and encourage transition to these sustainable methods.
Additionally, Regeneration International lists partnerships globally, including Africa, Asia, Canada, Europe, Latin America, Oceania and the U.S. to support alternative food and farming systems. Many developing nations and geographic regions are already employing regenerative farming as they don’t have access to some of the equipment and resources used in tilled farming.
Here in the U.S., the USDA (U.S. Department of Agriculture) is working to advance the usage of sustainable farming practices, including support of programs like the Farmers for Soil Health whose goal is to improve soil health by encouraging farmers to expand their adoption of cover crops to 30 million acres by 2030.
For the nutrition industry’s part, it’s also important as leaders and stewards of our industry as a whole to support regenerative agriculture practices where possible to help safeguard our future supply chain and the environment. At Lief, our range of supplier partnerships includes sustainability focused suppliers who are pioneers and passionate industry advocates of regenerative agriculture, nutrition and climate health initiatives. Through these relationships, we can make more sustainable ingredients and raw material options available to our brand partners and educate them about regenerative farming and other sustainable practices.
Additional supportive measures for the industry include the Regenerative Organic Alliance, which has introduced a new certification for food, textiles, and personal care ingredients to recognize farms and products that meet the highest standards in the world for soil health, animal welfare and farmworker fairness.
If the industry takes an active role in supporting regenerative agriculture, we can help to mitigate future risk and improve our food and ingredients supply chain and the environment for generations to come. NIE
References:
World Economic Forum, www.weforum.org/agenda/2022/10/what-is-regenerative-agriculture/.
Food & Agriculture Organization of the United Nations, www.fao.org/fao-stories.
World Economic Forum, www.weforum.org/agenda/2023/01/5-ways-to-scale-regenerative-agriculture-davos23/.
https://regenerationinternational.org/.
Scott Springer has 25 years of experience in manufacturing, operations, and supply chain. He has worked in both the food & beverage industry and the nutraceutical/supplement industry for various companies, such as Coca-Cola, Bunge, Omega Protein and Vital Proteins. He is currently the chief operating officer of Lief Labs, a formulation and product development innovator and manufacturer of dietary supplements for premium brands located in Valencia, CA.
